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Multiplication of Environmental Labelling and Information Schemes (ELIS): Implications for Environment and Trade

Author

Listed:
  • Andrew Prag

    (OECD)

  • Thomas Lyon

    (University of Michigan)

  • Aimée Russillo

    (Liseed Consulting)

Abstract

This report explores potential effects of the recent rapid growth in Environmental Labelling Information Schemes (ELIS) around the world, with a focus on the implications of ELIS multiplication for environmental effectiveness and international trade. As empirical work on the environmental effects of ELIS multiplication is just beginning to appear, insights from the theoretical literature on label competition are presented. Modelling suggests that competition between labels may reduce environmental performance relative to a single label with strict environmental goals, though stylised modelling may not accurately reflect the complex real-world interactions of schemes. The analysis is complemented with an overview of empirical studies on environmental effects, including evidence that label competition has led to market-driven convergence of standards in some sectors, such as forest certification. However, it is important that convergence leads to more holistic and streamlined ELIS rather than acting as a weakening influence on the stringency and quality of standards or how schemes are implemented, to maximise environmental effectiveness. Multiplication of ELIS could have implications for the ways that labelling schemes interact with international trade, particularly in terms of market access and international competitiveness. Although difficult to demonstrate empirically, the conditions that could lead to such effects are described conceptually in the report, noting particularities of certain types of schemes such as quantitative footprints. The report also documents a range of ways that government and non-government bodies have responded to ELIS multiplication, such as mutual recognition of schemes and creation of “focal” schemes or standards that can lead to market convergence. Such responses could also alter trade effects of ELIS under certain conditions, for example if a particular voluntary scheme becomes sufficiently dominant in a country to be perceived as a “de facto” market entry requirement by suppliers in other countries. L’objet du présent document est d’étudier les retombées potentielles de la multiplication des dispositifs d’éco-étiquetage et d’information environnementale (DEIE) observée depuis peu dans le monde, en particulier du point de vue de l’efficacité environnementale et du commerce international. Comme il y a peu d’études empiriques sur la multiplication des DEIE, les résultats des travaux de modélisation théoriques concernant la mise en concurrence des dispositifs sont présentés. D’après les exercices de modélisation théorique, la concurrence entre labels peut réduire la performance environnementale par rapport à un label unique visant des objectifs strictement environnementaux. Cependant, le caractère simplifié des modèles employés et la complexité du paysage dans lequel évoluent les DEIE limitent certainement l’intérêt de la modélisation pour la définition de l’action à mener. L’analyse est complétée par une revue d’études empiriques sur l’efficacité environnementale des DEIE. La concurrence entre labels semble entraîner sur la durée une uniformisation et une convergence des normes tirée par le marché, par exemple, dans le secteur de la certification forestière. Pour que les bienfaits écologiques soient optimaux, il importe que la convergence ne mène pas à l’abaissement du niveau d’exigence et de la qualité des normes utilisées. La multiplication des DEIE pourrait influer sur leur lien avec le commerce international, en particulier en ce qui concerne l’accès au marché et la compétitivité internationale. Bien que ces effets soient difficiles à démontrer à partir de données empiriques, le rapport décrit les conditions en principe susceptibles de conduire à ces effets. Les particularités de certains types de dispositif dans ce regard sont notés, comme par exemple les labels « enceintes ». Le rapport s’intéresse également aux actions prise par les acteurs gouvernementaux et non gouvernementaux pour rendre le marché des DEIE cohérent et prévisible. Ces actions comprennent, par exemple, des accords de reconnaissance mutuelle ou la création de normes ou labels de « référence ». Ces actions peuvent également mener une influence sur le commerce international, par exemple si un dispositif d’application facultative gagne un part de marché qui semble constituer un critère de facto d’entrée sur le marché.

Suggested Citation

  • Andrew Prag & Thomas Lyon & Aimée Russillo, 2016. "Multiplication of Environmental Labelling and Information Schemes (ELIS): Implications for Environment and Trade," OECD Environment Working Papers 106, OECD Publishing.
  • Handle: RePEc:oec:envaaa:106-en
    DOI: 10.1787/5jm0p33z27wf-en
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    Cited by:

    1. Momsen, Katharina & Ohndorf, Markus, 2022. "Information avoidance, selective exposure, and fake (?) news: Theory and experimental evidence on green consumption," Journal of Economic Psychology, Elsevier, vol. 88(C).
    2. Vasileva, Elka & Hristova, Juliya, 2016. "Устойчивото управление и доброволното разкриване на информация за екологичните дейности в организациятa (Sustainable management and voluntary disclosure of information about environmental activities o," MPRA Paper 75201, University Library of Munich, Germany.

    More about this item

    Keywords

    Eco-labels; Ecolabels; empreintes environnementales des produits; environmental reporting; information policy approaches; politique d’approches informationnelles; product environmental footprints; rapports environnementaux; trade and environment;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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